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Supreme Court of Vanuatu |
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IN
THE SUPREME COURT
OF THE REPUBLIC OF
VANUATU
(Civil Jurisdiction)
Civil Case No.26 of 2004
BETWEEN:
DALSE
TEMAKON
Claimant
AND:
VANUATU
COMMODITIES MARKETING BOARD
Defendant
Coram: Justice H. Bulu
Counsels: Mr. Robert Sugden
for the Claimant
Mrs. Heather L. Leo for the Defendant
Date of
Hearing: 12 April 2007
Date of Decision: 20 April 2007
RESERVED JUDGMENT
Background
1. The
Claimant commenced employment with the Defendant on 3 January 1983. On 1st
October 2001, as part of a restructuring by the
Defendant of its administrative
structure, the Claimant’s employment was terminated and she was
immediately re-employed in
a very similar position to that which she had
previously occupied but at a reduced salary of VT200,000 per month.
2. The Claimant was paid all of her entitlements upon termination up to
30 September, 2001 and then continued in her new employment
from 1 October, 2001
until 17 December 2001. On 17 December, 2001 the Claimant and the Defendant
entered into a written contract
(contract) for her employment beyond that date
in the statutory position of secretary of the Defendant’s Board. The
contract
specified the Claimant’s duties and provide specifically for some
of the Claimant’s benefits and conditions of employment
and referred to
the staff regulation for others.
3. On 13 May, 2002 the Defendants Board
at a meeting, decided (Decision) that the Claimant was must be disciplined for
revealing information
concerning the Defendant’s affairs to her husband
and, on that basis, suspended the Claimant from official duties and suspended
all her benefits under the contract except her salary was reduced by one half.
4. The Claimant remained suspended until 13 November, 2002 when the
Defendant dismissed her on the basis of the decision that it had
made on 13 May,
2002 that the Claimant was guilty of the offence contrary to section 20 A of the
VCMB Act.
5. As a consequence, on 13 February, 2004 the Claimant
commenced proceedings against the Defendant in the Supreme Court. On 8th
October,
2004 leave was granted to the Claimant to amend her claim and as a
consequence the Amended Statement of the case was filed on 11th
October, 2004.
6. The Claimant claimed that:-
(a) The decision to suspend her and placed her on half salary and terminating other benefits is void for bias and lack of natural justice. That when the decision was made the Defendant’s Board was chaired by the Board Chairman, Mr. Noel Fionalave. It is Mr. Fionalave who had accused the Claimant of divulging information contrary to section 20 A (1) of the Act and brought the accusation before the Board seeking that she be dealt with by the Board. That Mr. Fionalave bore personal animus towards the Claimant at that time the decision was made. The Claimant was given no notice of the accusation that was made against her and was given no opportunity by the Defendant to defend herself.
(b) The decision to dismiss the Claimant on 13 November, 2002 amounts to unjustified dismissal under section 50 of the Employment Act. The Claimant was not given an opportunity between 13 May and 13 November, 2002 to be heard in relation to the charges. Despite responding to the charge against her through legal counsel on 16 May 2002 no opportunity was afforded to the Claimant to be heard.
Default
Judgment
7. The Amended Claim was filed on 11th October, 2004 and
serve on Jack I. Kilu and Associates in Port Vila on the same date at about
4.42
p.m. No response was filed by Jack I. Kilu & Associates and no defence was
filed either within the times stipulated under
rule 4.13 of the Civil Procedure
Rules.
8. A request for the Court to enter judgment in default against
the Defendant was made on 2 November. The Court however, only granted
judgment
in default on 24 January 2005. No defence had been filed even by that date.
Application
to set Aside Default Judgment
9. On 9th March, 2006 an
Application to set Aside Default Judgment was filed in the Supreme Court. The
Application contained the defence
to the claim as well and it is set out as
follows:-
“The applicants defence to the claim are:-
(a) Claimant is not entitled to severance pay from 3rd January 1983 to 1st October 2001 as her employment entitlements for this period was paid on 3rd October 2001 to her ANZ Bank Vila Account No. 124210 bearing the total sum of VT11,804,984.
(b) For the period 17th December 2001 to 16th December 2005 the Claimant is not entitled to any severance pay and other entitlements due to her dismissal from VCMB:-
(i) Claimant was dismissed from employment for breaching clause 12 (2) of her employment contract with VCMB;
(ii) Claimant is not entitled to any payment between 17th December 2001 and 13th May 2002 the date she was suspended, nor is she entitled to any payments for the period 13th May 2002 to 17th December 2005 the date her contract was supposed to have ended because she was dismissed;
(iii) Defendant had followed internal disciplinary process to dismiss the Claimant from employment;
(iv) The Claimant was not immediately dismissed which warranted immediate termination nor was she terminated or dismissed for unjustified reasons. The reason for termination was part of Claimant’s obligation under the term of her contract which she had breached.
(c) In the event that the court finds against the Defendant in (b) (i), (ii) (iii) and (iv) above, the Defendant says the amount of VT13,360,793 ordered against them is unjustified and grossly excessive in the light of the assessments of payments calculated under the Employment Act and refer to the matter of Wendy Garu –v- Municipality of Luganville Civil Case No. 12 of 1997 decided in the Supreme Court of Vanuatu on 12 November 2004.”
The
Law
10. The Default Judgment entered on 24 January 2005 was done
pursuant to Part 9 of the Civil Procedure Rules. The amount claimed is
VT12,730,269.
11. Rule 9.5 provides that a defendant against who
judgment has been signed may apply to the Court to have the judgment set aside.
The application may be made at any time. It must set out the reasons why the
defendant did not defend the claim, and must give details
of the defendants
defence to the claim, and must have with it a sworn statement in support of the
application.
12. Subrule (3) of rule 9.5 provides that:-
“The Court may set aside the default judgment if it is satisfied that the defendant:-
(a) has shown reasonable cause for not defending the claim; and
(b) has an arguable defence, either about his or her liability for the claim on the amount of the claim.”
Reasonable
cause for not defending the
claim
Applicant’s
case
13. Legal counsel for the Applicant simply submitted to this
Court that previous lawyers who had represented the Defendant did not
show up.
Nothing more was put to the Court.
14. Karl Batick in his sworn
statement filed on 9th March 2006 deposed to the fact that:-
(a) In the matter of Dalse Temakon –v- VCMB CC26 of 2004, VCMB had engaged a legal counsel from Jack Kilu & Associates to represent it. This was made possible through a retainer agreement signed on 22 August 2003.
(b) After signing of the agreement VCMB believed that Jack Kilu & Associates were taking care of their interests in the civil matter at hand. This believe proved to be wrong when he received a copy of the Default Judgment on 15 February 2005.
(c) On and after receipt of the Default Judgment he believed that Jack Kilu & Associates were still acting for them and were appearing for them at enforcement conferences on 4th July and 15th July 2005.
(d) After 15th July it become clear that the firm the Defendant had retained had “continued not to appear in Court to defend us in this matter”.
(e) The Defendant then withdrew from Jack Kilu & Associates and requested Mr. Ishmael Kalsakau to represent them.
Defendant’s
case
15. Counsel for the Defendant contends that no reasonable
cause has been shown why VCMB has not defended the claim because:-
(a) The Supreme Court Claim was first filed on 13 February 2004.
(b) Sworn Statement of service of Dalse Temakon shows that the claim was served on the Defendant VCMB on 1st April 2004.
(c) Unfiled copy of the claim was served on Mr. Kilu also and Mr. Kilu advised by letter that he will respond on being served with filed copies of the claim.
(d) The Applicant does not explain why nothing has been done between 1st April 2004 and 24 January 2005 when Default Judgment was entered. No reasons whatever have been given to the Court for the non-action.
Considerations
16. The
first test that the Court must be satisfied of is that the Defendant (VCMB in
this case) has shown reasonable cause for not
defending the claim pursuant to
rule 9.5 (3).
17. What does that mean. In my view, it simply means that
the Defendant must show to the Court reasons and the Court is satisfied
of the
reasons that caused the Defendant not to defend the claim, are good reasons. The
reasons must be good reasons.
18. The reasons advanced by the Defendant,
in my view, do not amount to reasonable cause or good reasons for failing to
defend the
claim. The claim is for a total sum of approximately VT13 million.
That is a huge sum being claimed against the Defendant. It is
a very serious
matter indeed. However, there is no evidence that since the claim was served on
the Defendant, it took steps regularly
to talk to its legal counsel to ascertain
the status of the case, and, if need be, to give instructions on matters arising
in the
case.
19. The Application fails on this ground.
Has good
defence about liability for the claim or about amount of the
claim?
Applicant’s
case
20. The second test is that the Court must be satisfied that
the Defendant has an arguable defence about liability for the claim or
about the
amount of the claim.
21. The defence as contained in the Application to
Set Aside Default Judgment:-
(a) States that the Claimants is not entitled to severance pay from 3rd January 1983 to 1 October 2001 as employment benefits for that period had been paid.
(b) States that the Claimant is not entitled to any severance pay and other entitlements for the period 17 December 2001 to 16 December 2005 due to her dismissal from VCMB.
(c) States that in the event that the Court finds against VCMB, the Defendant says the amount ordered against it is unjustified and grossly excessive in the light of the assessments of payments calculated under the Employment Act.
22. Counsel for the Defendant contended that
the Claimant may be entitled to some benefits but not to the amount claimed and
ordered
in the Default Judgment.
23. The secrecy provision of the VCMB
Act and her contract of employment prohibits the Claimant from divulging any
information about
her employer’s business without permission frist
obtained from the Defendant. The Claimant’s employment was terminated
on
13 November 2002 because she breached the terms of her contract. Mrs. Leo
continued that the Board has the power to suspend and
terminate the employment
of the Claimant. Where the Board suspends an employee as in this case, the
management is charged with the
duty to investigate the matter and then return
its findings to the Board for a determination.
24. Mrs. Leo continued
that the resolution of the Board meeting, on 13 November 2002 about the
Claimant’s case was too general.
The resolution stated that it
“was resolved that since this matter
has taken a long time to be resolved, the chairman is mandated to work with the
management to
provide all evidences relating to the Board secretary’s
actions.” Why terminate on the same date of the resolution? She
contended that may be evidence was available of the Claimant’s
wrong doing
but such evidence was not made available to the Board. There is no other
rational explanation for the termination to
have taken place on the same date of
the Board resolution.
25. Mrs. Leo continued that the position of
secretary to the Board is a very senior position. She is answerable to the
Board. The
suspension period was long and it is unreasonable of the Claimant not
to have responded to the allegations against her, even when
she was not
specifically requested to put her views to the Board for consideration. The
Board waited for her response until 13 November
2002. It was unfair for her to
keep the Board waiting for such a long period of time.
26. Mrs. Leo
further contended that this Court has a duty to consider the evidence of the
Defendant through sworn statements of various
witnesses especially Karl Batick,
Noel Fionalave and Jean Alain Mahe to determine whether the Claimant breached
the secrecy provisions
of her employment contract.
27. Mrs. Leo finally
submitted that:-
(a) From 13 May 2002 to 13 November 2002 the Claimant is entitled to her benefits.
(b) On termination on 13 November 2002, the Claimant is not entitled to the payment of any benefit as she had breached her contract.
Respondent’s
case
28. Mr. Sugden on behalf of the Claimant contends that the
Defendant has no arguable case because:-
(a) The claim against VCMB is that the decision to suspend and then terminate the Claimant cannot stand as it was biased and no opportunity was given to the Claimant to answer the charges against her. The termination of employment was an unjustified dismissal under section 50 of the Employment Act. The Application to Set Aside the Default Judgment fails to deal with the cause of termination which are bias and natural justice denied as pleaded in the claim.
(b) The Claimant responded to her suspension to the Defendant on 16 May 2002 putting her views to the Defendant and further on 31 May 2002. However, no reply was ever received from the Defendant.
(c) No opportunity to be heard was granted to the Claimant by the Defendant on 13 May 2002 up to 13 November 2002 when her employment was terminated.
(d) No justification has been put to this Court why that did not happen.
(e) No reasons has been put to this Court to justify the suspension and termination in the manner it happened.
(f) The minutes of the Board meeting on 13 November 2002 contains no authority by the Board to terminate the Claimant’s employment. In fact the Board mandated the then chairman to commence an investigation to determine the Claimant’s case. The chairman had no authority to terminate the employment of the Claimant.
Considerations
29. The Defence as pleaded in the Application to set aside the
Default Judgment contains no reasons whatsoever in justifying VCMB’s
actions to terminate the Claimant’s employment in the manner it did. The
evidence before this Court:-
(a) Shows that an allegation was made to VCMB Board by Noel Fionalave that the Claimant had leaked information about internal affairs of the Defendant to her husband.
(b) Shows the VCMB Board considered the allegation and suspended the Claimant on 13 May 2002.
(c) Shows that on 13 November 2002, on finding that the matter had not progressed at all since the Board meeting of 13 May 2002, the Board specifically “mandated (the chairman) to work with management to provide all evidences relating to the Board secretary’s actions”.
30. Contrary to the
resolution of the Board the then chairman, Gilbert Norman, wrote to the Claimant
on 13 November 2002 stating that
the
“Board met on 8th November 2002 and
resolved to terminate your employment with the immediate effect for reasons
stated in the letter
(of 13 May 2002)”. This was a blatant lie by a
person who is the chairman of the VCMB Board, who carries with him public trust
that he will
act lawfully and be honourable in his actions and decisions in such
a public office. VCMB Board is, in my view, equally culpable
in that it did not
take any step to ensure that the decision is revoked and the investigation
process as decreed by the Board continue
to determine the truthfulness of the
allegation against the Claimant of leaking information about internal dealings
or affairs of
the VCMB.
31. In my view, the Court’s duty in an
application such as this is not to examine the evidence available at the time
the Decision
was made but rather to examine the manner or process followed by
the Board to determine whether that process was fair pursuant to
the laws of
this jurisdiction. There is no evidence before this Court that:-
(a) The Claimant was invited to respond to the allegations made against her;
(b) The Claimant was invited to attend the Board meeting on 13 May 2002 to put her case to the Board before a decision was made.
(c) The Claimant was invited to put her version of events in writing to the Board.
(d) The Claimant was invited to attend nor address the Board in writing on 13 November 2002 before the decision was made by the Board.
(e) The Claimant was invited to address the chairman verbally or in writing about the allegations before he wrote the letter dated 13 November 2002 terminating her employment.
32. There is no
evidence before this Court that the Board complied with its own disciplinary
process before terminating the Claimant’s
employment.
33. There is
no evidence that the Board accorded the right to natural justice to the
Claimant.
34. There is no evidence that the Board complied with section
50 of the Employment Act.
35. For those reasons, I am not satisfied that
the Defendant has an arguable defence about its liability for the claim nor the
amount
of the claim.
36. The Orders of the Court are:-
(a) The Application is dismissed with costs on a standard basis and to be taxed if not agreed.
(b) The Defendant is restrained from dealing or dealing further with the leasehold properties having registered titles:-
(i) 11/OD31/010
(ii) 11/OI21/002
(iii) 11/OD31/001
(iv) 03/OH71/026
and pay any money that it has received in respect of any of them to the Sheriff.
(c) That the warrant be renewed giving the Sheriff time to execute it.
(d) That the Sheriff immediately proceed to execute the warrant.
(e) That there be a further enforcement conference in one month time for the Sheriff to report his progress with the warrant.
(f) That this order and the new warrant be served on the VCMB through its lawyer by the Sheriff within 7 days.
DATED at
Port Vila, this 20th day of April, 2007.
H.
BULU
Judge
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